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Industry roundup: 20 October 2020

FSB publishes global transition roadmap for LIBOR

The Financial Stability Board (FSB) has published a global transition roadmap for LIBOR. The roadmap sets out a timetable of actions for financial and non-financial sector firms to take in order to ensure a smooth LIBOR transition by end-2021. In July, the FSB reaffirmed that financial and non-financial sector firms across all jurisdictions should continue their efforts to make wider use of risk-free rates in order to reduce reliance on IBORs where appropriate and in particular to remove remaining dependencies on LIBOR by the end of 2021.

The LIBOR benchmarks are not guaranteed to continue to be available after end-2021 and therefore preparations should be underway to reduce reliance on these rates well ahead of that point. Use of LIBOR in the five LIBOR currencies (USD, GBP, EUR, JPY and CHF) is widespread internationally. Transition away from LIBOR by end-2021 requires significant commitment and sustained effort from both financial and non-financial institutions across many LIBOR and non-LIBOR jurisdictions.

The Global Transition Roadmap for LIBOR is intended to inform those with exposure to LIBOR benchmarks of some of the steps they should be taking now and over the remaining period to end-2021 to successfully mitigate these risks. These are considered prudent steps to take to ensure an orderly transition by end-2021 and are intended to supplement existing timelines/milestones from industry working groups and regulators. Among the steps in the Roadmap:

  • Firms should have already, identified and assessed all existing LIBOR exposures and agreed on a project plan to transition in advance of end-2021.
  • By the effective date of the ISDA Fallbacks Protocol, the FSB strongly encourages firms to have adhered to the Protocol.
  • By the end of 2020, firms should be in a position to offer non-LIBOR linked loans to their customers.
  • By mid-2021, firms should have established formalised plans to amend legacy contracts where this can be done and have implemented the necessary system and process changes to enable transition to robust alternative rates.
  • By end-2021, firms should be prepared for LIBOR to cease.


TIS and Orchard Finance extend partnership agreement

Treasury Intelligence Solutions (TIS), a cloud-based platform for corporate payments, and Orchard Finance Consultants, a Dutch consultancy organisation in the field of debt advisory, treasury and staffing, have announced that they have extended their partnership agreement.

“We are very happy about the collaboration with Orchard Finance and we believe the partnership will further strengthen our positioning in BENELUX to serve the best interest of our customers in treasury and corporate payments,” said Aderito Duarte, senior sales executive BENELUX at TIS.

“Orchard Finance is expanding its ecosystem with selected knowledge and technology partners and TIS is one of our technology partners in the field of bank connectivity solutions for corporate treasury," added Ariane Hoksbergen, practice lead Treasury Technology at Orchard Finance. "We look forward to strengthening our collaboration.”


Billtrust to become publicly traded company through combination with South Mountain Merger Corporation

Billtrust, a provider of B2B order-to-cash solutions, and South Mountain Merger Corporation, a publicly traded special purpose acquisition company, have announced they have entered into a definitive business combination agreement. The combined company will continue as a publicly listed entity and have an implied estimated enterprise value of approximately US$1.3bn at closing, based on current assumptions.

Upon closing of this transaction, the company intends to change its name to BTRS Holdings and is expected to trade on The Nasdaq Stock Market. Billtrust’s management team will continue to lead the company.

“Over the last 19 years, we have built comprehensive B2B commerce solutions across the value chain, creating real business outcomes and significant value for our customers, while making it easy for them to get paid," said Flint Lane, founder and CEO of Billtrust. "We believe AR is ripe for innovation, and together we will continue to invest in opportunities to scale the business, growing both organically and inorganically, as we seek to tackle the large total addressable market. As a leader in AR automation, we believe Billtrust is well-positioned to own a disproportionate share.”

The transaction has been unanimously approved by the boards of both Billtrust and South Mountain. The transaction is expected to close in early 2021, subject to approval by the stockholders of South Mountain, the effectiveness of a registration statement to be filed with the Securities and Exchange Commission in connection with the transaction, and other customary closing conditions including a minimum cash condition of US$225m, of which US$200m has been committed via the PIPE and an incremental US$22m has been committed in the form of a non-redemption commitment from an institutional shareholder.


Citizens Bank & Trust selects CheckAlt as lockbox processing partner

CheckAlt, a provider of lockbox and treasury management solutions in the US, has been selected by Florida-based Citizens Bank & Trust to provide lockbox services as part of the bank’s strategy to further serve its existing corporate customer base and expand its market reach.

“After exploring other options in the market, we selected CheckAlt as our preferred lockbox partner for their platform, presentation, and the people,” said Chad Tagtow, SVP and chief information officer of Citizens Bank & Trust. “We greatly appreciate CheckAlt’s availability to quickly respond to questions throughout the selection process and are eager to work with the team to support our bank’s growth.”

Citizens Bank & Trust previously processed lockbox payments in house, and as part of the bank’s growth plan selected CheckAlt to batch, scan, process, and deliver payment files for cheque payments for the bank’s lockbox customers - leveraging CheckAlt’s regional processing centre in Tampa.

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